With banks tightening credit to the property sector the HCM City market is cooling off, traders said.

With banks tightening credit to the property sector the HCM City market is cooling off, traders said. — Photo plo.vn

In District 9 for instance, unlike a month ago, many people are offering to sell their lands but cannot find buyers.

The offers are much higher than bids, a broker said.

Hữu Tín, a broker from Bình Tân District, told Người Lao Động (The Labourer) newspaper there have been no transactions for a week.

He has a 50sq.m house on Đỗ Năng Tế Street for sale for VNĐ4 billion (US$175,000), but there are no takers, he said.

Even recently everything on offer was being snapped up immediately, he said.

Lê Thị Hồng Thắm of District 7 told Việt Nam News she invested VNĐ1.7 billion ($74,5000) to buy a piece of land near Long Hậu Industrial Zone in Long An Province just off HCM City and sell it immediately.

“Earlier, land could be re-sold within three or four days of buying. But now, half a month has passed but I have been unable to sell it.”

A broker in District 12 said she no longer accepts offers for sale because there are no buyers.

The deputy director of a real estate company in District 2 said in the last week or so the market has lost steam.

While a month ago he was closing five to seven deals every day, it has come down now to just one or two, he said.

According to insiders, the main reason for the slowdown is the tightening of credit by banks.

Banks have started hiking interest rates on loans for buying property.

The Việt Nam Export – Import Commercial Joint Stock Bank has increased interest by 1 percentage point to 11 per cent on all loans including buying new property or upgrading housing.

Other banks have increased the rate to 12-12.5 per cent.

Besides, lenders have cut the loan amount from 70 per cent of the property’s value to 30-40 per cent.

A Sacombank credit official told Việt Nam News on condition of anonymity that there has been no official guidance from her bank’s leaders on interest rates.

Her bank also limits the amount of loans for buying lands in places where the market has been hot like Districts 2, 9, Củ Chi and Nhà Bè.